Global airlines will need $80bn more to stay airborne, IATA warns
Industry body the International Air Transport Association (IATA) has warned that the world’s airlines will need another $80bn (£60bn) in aid to get through the rest of coronavirus crisis.
Governments around the world have already put up $160bn to keep their struggling carriers airborne, but IATA director-general Alexandre de Juniac said more would be needed.
“We are extremely grateful to them for having injected $160 billion into the sector. For the coming months, the industry’s needs are evaluated at $70-80 bn in additional aid. Otherwise some airlines will not survive”, he said.
European flag carriers such as Lufthansa and Air France received whopping loans from their respective governments, while in the US Congress approved a $25bn package for airlines just to keep staff on their payroll while they were grounded.
De Juniac made the remarks at an aviation conference in Paris after the news that not one but two vaccines have been found to be over 90 per cent effective against the disease.
Despite renewed optimism that the developments could see a return to normal life sooner than previously expected, airlines have been cautious in their outlook for the coming months.
Traders, however, have shown no such inhibitions, piling into airline and travel stocks over the past two weeks in a much-needed show of support for the sector.
Collectively, IATA said that airlines were facing losses of an eye-watering $100bn for the year, with many forced to ground their planes for three months due to travel restrictions.
With secondary lockdowns now in place across much of Europe, airlines are forecasting flying between 20 and 40 per cent of their normal capacity over the winter period.
The continued downturn has raised concerns that carriers will go back to their governments to top up original bailout packages.
Norwegian Air has already done so, but found itself turned down by officials, leading it to file for bankruptcy protection in Ireland.